0001040971-20-000014.txt : 20200423 0001040971-20-000014.hdr.sgml : 20200423 20200423135145 ACCESSION NUMBER: 0001040971-20-000014 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 21 CONFORMED PERIOD OF REPORT: 20200422 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20200423 DATE AS OF CHANGE: 20200423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SL GREEN REALTY CORP CENTRAL INDEX KEY: 0001040971 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 133956775 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13199 FILM NUMBER: 20810423 BUSINESS ADDRESS: STREET 1: 420 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10170 BUSINESS PHONE: 2125942700 MAIL ADDRESS: STREET 1: 420 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10170 8-K 1 a20q18-k.htm 8-K Document
false0001040971 0001040971 2020-04-22 2020-04-22 0001040971 us-gaap:CommonStockMember 2020-04-22 2020-04-22 0001040971 us-gaap:PreferredStockMember 2020-04-22 2020-04-22



    
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K


CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

April 22, 2020

SL GREEN REALTY CORP.
(Exact name of registrant as specified in its charter)


Maryland
(State of Incorporation)

1-13199
13-3956775
(Commission File Number)
       (I.R.S. employer identification number)

420 Lexington Avenue
               10170
New York,
New York
             (Zip Code)
(Address of principal executive offices)

(212) 594-2700
(Registrant's telephone number, including area code)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Registrant
 
Trading Symbol
 
Title of Each Class
 
Name of Each Exchange on Which Registered
SL Green Realty Corp.
 
SLG
 
Common Stock, $0.01 par value
 
New York Stock Exchange
SL Green Realty Corp.
 
SLG.PRI
 
6.500% Series I Cumulative Redeemable Preferred Stock, $0.01 par value
 
New York Stock Exchange






Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company     []
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act [ ]






Item 2.02.    Results of Operations and Financial Condition

Following the issuance of a press release on April 22, 2020 announcing SL Green Realty Corp.’s, or the Company, results for the quarter ended March 31, 2020, the Company has made available on its website supplemental information regarding the Company’s operations that is too voluminous for a press release. The Company is attaching the press release as Exhibit 99.1 and the supplemental package as Exhibit 99.2 to this Current Report on Form 8-K.

The information (including Exhibits 99.1 and 99.2) being furnished pursuant to this “Item 2.02. Results of Operations and Financial Condition” shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or otherwise subject to the liabilities of that section and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Act, or the Exchange Act regardless of any general incorporation language in such filing.

Item 7.01.    Regulation FD Disclosure

As discussed in Item 2.02 above, on April 22, 2020, the Company issued a press release announcing its results for the quarter ended March 31, 2020, and that it is revising its earnings guidance of net income per share of of $7.43 to $7.53, and NAREIT defined FFO per share (diluted) of $7.25 to $7.35 for the year ending December 31, 2020 to $1.83 to $2.33 of net income per share, and $6.60 to $7.10 of FFO per share (diluted).

The following table reconciles estimated earnings per share (diluted) to FFO per share (diluted) for the year ending December 31, 2020:
 
Year ended December 31,
 
2020
 
2020
 
Net income per share attributable to SL Green stockholders
$
1.83

 
$
2.33

 
Add:
 
 
 
 
Depreciation and amortization
3.33

 
3.33

 
Joint ventures depreciation and noncontrolling interests adjustments
2.39

 
2.39

 
Depreciable real estate reserve

 

 
Less:
 
 
 
 
Net income attributable to noncontrolling interests
0.03

 
0.03

 
Gain on sale of real estate
0.89

 
0.89

 
Equity in net gain on sale of interest in unconsolidated joint venture / real estate

 

 
Purchase price and other fair value adjustments

 

 
Depreciation and amortization on non-real estate assets
0.03

 
0.03

 
Funds from Operations per share attributable to SL Green common stockholders and noncontrolling interests
$
6.60

 
$
7.10

 

The information being furnished pursuant to this “Item 7.01. Regulation FD Disclosure” shall not be deemed to be “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act regardless of any general incorporation language in such filing. This information will not be deemed an admission as to the materiality of such information that is required to be disclosed solely by Regulation FD.

Item 9.01.    Financial Statements and Exhibits

(d)     Exhibits







Non-GAAP Supplemental Financial Measures

Funds from Operations (FFO)

FFO is a widely recognized non-GAAP financial measure of REIT performance. The Company computes FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The revised White Paper on FFO approved by the Board of Governors of NAREIT in April 2002, and subsequently amended, defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of properties, and real estate related impairment charges, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.

The Company presents FFO because it considers it an important supplemental measure of the Company’s operating performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, particularly those that own and operate commercial office properties. The Company also uses FFO as one of several criteria to determine performance-based bonuses for members of its senior management. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions, and real estate related impairment charges, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, and interest costs, providing perspective not immediately apparent from net income. FFO does not represent cash generated from operating activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance or to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity, nor is it indicative of funds available to fund the Company’s cash needs, including our ability to make cash distributions.

Funds Available for Distribution (FAD)

FAD is a non-GAAP financial measure that is calculated as FFO plus non-real estate depreciation, allowance for straight line credit loss, adjustment for straight line operating lease rent, non-cash deferred compensation, and a pro-rata adjustment for FAD from SLG’s unconsolidated JVs, less straight line rental income, free rent net of amortization, second cycle tenant improvement and leasing costs, and recurring building improvements.
FAD is not intended to represent cash flow for the period and is not indicative of cash flow provided by operating activities as determined in accordance with GAAP. FAD is presented solely as a supplemental disclosure with respect to liquidity because the Company believes it provides useful information regarding the Company’s ability to fund its dividends. Because all companies do not calculate FAD the same way, the presentation of FAD may not be comparable to similarly titled measures of other companies. FAD does not represent cash flow from operating, investing and finance activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of the Company’s liquidity.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre)

EBITDAre is a non-GAAP financial measure. The Company computes EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which may not be comparable to EBITDAre reported by other REITs that do not compute EBITDAre in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The White Paper on EBITDAre approved by the Board of Governors of NAREIT in September 2017 defines EBITDAre as net income (loss) (computed in accordance with Generally Accepted Accounting Principles, or GAAP), plus interest expense, plus income tax expense, plus depreciation and amortization, plus (minus) losses and gains on the disposition of depreciated property, plus impairment write-downs of depreciated property and investments in unconsolidated joint ventures, plus adjustments to reflect the entity's share of EBITDAre of unconsolidated joint ventures.
The Company presents EBITDAre because the Company believes that EBITDAre, along with cash flow from operating activities, investing activities and financing activities, provides investors with an additional indicator of the Company’s ability to incur and service debt. EBITDAre should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of the Company’s liquidity.





Net Operating Income (NOI) and Cash NOI
NOI is a non-GAAP financial measure that is calculated as operating income before transaction related costs, gains/losses on early extinguishment of debt, marketing general and administrative expenses and non-real estate revenue. Cash NOI is also a non-GAAP financial measure that is calculated by subtracting free rent (net of amortization), straight-line rent, and the amortization of acquired above and below-market leases from NOI, while adding operating lease straight-line adjustment and the allowance for straight-line tenant credit loss.

The Company presents NOI and Cash NOI because the Company believes that these measures, when taken together with the corresponding GAAP financial measures and our reconciliations, provide investors with meaningful information regarding the operating performance of properties. When operating performance is compared across multiple periods, the investor is provided with information not immediately apparent from net income that is determined in accordance with GAAP. NOI and Cash NOI provide information on trends in the revenue generated and expenses incurred in operating our properties, unaffected by the cost of leverage, straight-line adjustments, depreciation, amortization, and other net income components. The Company uses these metrics internally as performance measures. None of these measures is an alternative to net income (determined in accordance with GAAP) and same-store performance should not be considered an alternative to GAAP net income performance.
Coverage Ratios
The Company presents fixed charge and debt service coverage ratios to provide a measure of the Company’s financial flexibility to service current debt amortization, interest expense and operating lease rent from current cash net operating income. These coverage ratios represent a common measure of the Company’s ability to service fixed cash payments; however, these ratios are not used as an alternative to cash flow from operating, financing and investing activities (determined in accordance with GAAP).





SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 
SL GREEN REALTY CORP.
 
 
 
/s/ Matthew J. DiLiberto
 
Matthew J. DiLiberto
 
Chief Financial Officer
 
 
Date: April 23, 2020
 




EX-99.1 2 a20q1earningsrelease.htm EXHIBIT 99.1 Exhibit
Exhibit 99.1


CONTACT                        
Matt DiLiberto
Chief Financial Officer
(212) 594-2700

SL GREEN REALTY CORP. REPORTS
FIRST QUARTER EPS OF $1.47 PER SHARE;
AND FFO OF $2.08 PER SHARE


Financial and Operating Highlights
Net income attributable to common stockholders of $1.47 per share for the first quarter as compared to $0.52 per share for the same period in 2019. Net income attributable to common stockholders for the first quarter of 2020 includes $72.3 million, or $0.88 per share, of net gain recognized from the sale of The Olivia.
Funds from operations, or FFO, of $2.08 per share for the first quarter, which includes the recognition of $37.7 million, or $0.46 per share, of incremental income from Credit Suisse at 1 Madison Avenue representing rent through December 31, 2020, offset by $11.2 million, or $0.14 per share, of reserves against the Company’s debt and preferred equity portfolio related to the potential sale of certain investments and the implementation of the Current Expected Credit Loss, or CECL, regulations. FFO for the same period in 2019 was $1.68 per share.
The Company is revising its earnings guidance ranges for the year ending December 31, 2020 to net income per share of $1.83 to  $2.33 and FFO per share of $6.60 to $7.10 per share as we expect that the global COVID-19 pandemic will have an impact on our business, and our industry as a whole, going forward. A reconciliation of the Company's new FFO guidance to the previously provided FFO guidance is as follows:

Funds From Operations per share
Initial Guidance
$
7.25

$
7.35

Real Estate GAAP NOI
0.03

0.16

Debt & Preferred Equity Income
(0.34
)
(0.29
)
Debt & Preferred Equity Reserves
(0.29
)
(0.22
)
Other Income, Net
(0.09
)
(0.06
)
Interest Expense & Preferred Dividends
(0.05
)
0.05

General & Administrative Expense
0.09

0.11

Revised Guidance
$
6.60

$
7.10


Same-store cash net operating income, or NOI, including our share of same-store cash NOI from unconsolidated joint ventures, increased 0.7% for the first quarter excluding lease termination income and free rent to Viacom at 1515 Broadway, as compared to the prior year, consistent with the Company's expectations.





Signed 30 Manhattan office leases covering 316,154 square feet in the first quarter. The mark-to-market on signed Manhattan office leases was 12.6% higher for the first quarter over the previous fully escalated rents on the same spaces.
Manhattan same-store occupancy was 95.5% as of March 31, 2020, inclusive of leases signed but not yet commenced, as compared to 96.0% at the end of the previous quarter.
Investing Highlights
Closed on the sale of 315 West 33rd Street, known as The Olivia, and an adjacent, undeveloped parcel of land for a sale price of $446.5 million, or approximately $906 per square foot. The transaction included a $100 million preferred equity investment by the Company, which was part of the original contract terms, and generated net cash proceeds to the Company of $95.7 million.
To date in 2020, the Company has repurchased a combined 2.6 million shares of common stock and common units of its Operating Partnership, or OP units, under the previously announced $3.0 billion share repurchase plan, at an average price of $83.25 per share. Since inception of the program, the Company has repurchased a total of 25.3 million shares of its common stock and redeemed 0.4 million OP units at an average price of $94.46 per share/unit. The Company has curtailed its share repurchase program until additional sources of liquidity from asset sales or internal free cash flow are established.
Entered into a 99-year ground lease of 126-132 Nassau Street, located at the corner of Nassau and Beekman Streets. The Company intends to develop a new, as-of-right, 215,000-square-foot building on the site and has secured a user for a long term net ground lease condominium of the building.
The previously contracted sale of 220 East 42nd Street, which was expected to close in the first quarter, did not move forward due to the buyer’s inability to execute the transaction. The Company has taken action to collect the $35.0 million contract deposit and is considering financing alternatives for the property.
Financing Highlights
Together with our joint venture partner, closed on the refinancing of 10 East 53rd Street. The new $220.0 million mortgage replaces the previous $170.0 million mortgage, has a 5-year term, and bears interest at a floating rate of 1.35% over LIBOR.
Entered into $350.0 million of fixed rate interest rate swaps against our unsecured corporate debt at a rate of 0.54375% through August 2021.
Summary
New York, NY, April 22, 2020 - SL Green Realty Corp. (the "Company") (NYSE: SLG) today reported net income attributable to common stockholders for the quarter ended March 31, 2020 of $114.8 million, or $1.47 per share, as compared to net income attributable to common stockholders of $43.8 million, or $0.52 per share, for the same quarter in 2019.





Net income attributable to common stockholders for the first quarter of 2020 includes $72.3 million, or $0.88 per share, of net gains recognized from the sale of The Olivia.
The Company reported FFO for the quarter ended March 31, 2020 of $172.0 million, or $2.08 per share, which includes the recognition of $37.7 million, or $0.46 per share, of incremental income from Credit Suisse at 1 Madison Avenue representing rent through December 31, 2020, offset by $11.2 million, or $0.14 per share, of reserves against the Company’s debt and preferred equity portfolio related to the potential sale of certain investments and implementation of the new Current Expected Credit Loss, or CECL, regulation. FFO for the same period in 2019 was $147.5 million, or $1.68 per share.
All per share amounts are presented on a diluted basis.
Operating and Leasing Activity
For the quarter ended March 31, 2020, the Company reported consolidated revenues and operating income of $314.3 million and $162.8 million, respectively, compared to $304.3 million and $160.3 million, respectively, for the same period in 2019.
Same-store cash NOI, including our share of same-store cash NOI from unconsolidated joint ventures increased by 0.7% for the first quarter, excluding lease termination income and free rent to Viacom at 1515 Broadway.
During the first quarter, the Company signed 30 office leases in its Manhattan portfolio totaling 316,154 square feet. Twenty-one leases comprising 181,600 square feet, representing office leases on space that had been occupied within the prior twelve months, are considered replacement leases on which mark-to-market is calculated. Those replacement leases had average starting rents of $70.68 per rentable square foot, representing a 12.6% increase over the previous fully escalated rents on the same office spaces. The average lease term on the Manhattan office leases signed in the first quarter was 10.1 years and average tenant concessions were 2.0 months of free rent with a tenant improvement allowance of $28.54 per rentable square foot.
Occupancy in the Company's Manhattan same-store portfolio was 95.5% as of March 31, 2020, inclusive of 404,018 square feet of leases signed but not yet commenced, as compared to 95.4% as of March 31, 2019.
Significant leases that were signed in the first quarter included:
Renewal and expansion with Hudson Yards Construction LLC for 75,704 square feet at 410 10th Avenue, for 21.1 years;
New lease with Memorial Hospital for Cancer and Allied Diseases for 54,199 square feet at 485 Lexington Avenue, for 10.0 years;
New lease with City Garage for 44,201 square feet at 810 Seventh Avenue, for 10.0 years; and
New lease with KCP Holdco, Inc. for 37,169 square feet at 707 Eleventh Avenue, for 10.0 years.
Investment Activity
To date in 2020, the Company has repurchased a combined 2.6 million shares of common stock and common units of its Operating Partnership, or OP units, under the previously





announced $3.0 billion share repurchase plan, at an average price of $83.25 per share/unit. Since inception of the program, the Company has repurchased a total of 25.3 million shares of its common stock under the program and redeemed 0.4 million OP units, allowing the Company to save approximately $91.2 million of common dividends and distributions on an annualized basis. The average price of total share repurchases and OP Unit redemptions to date is $94.46 per share/unit. The Company has curtailed its share repurchase program until additional sources of liquidity from asset sales or internal free cash flow are established.
In March, the Company closed on the sale of 315 West 33rd Street, known as The Olivia, and an adjacent, undeveloped parcel of land for a sale price of $446.5 million, or approximately $906 per square foot. The Company acquired the 36-story, 492,987-square-foot building in 2013. The mixed-use property includes 333 residential units with occupancy over 96 percent and 270,132 square feet of commercial space, which is 100 percent occupied. Commercial tenants include AMC Theater, Music Choice and Landmark Education. The transaction included a $100 million preferred equity investment by the Company, which was part of the original contract terms, and generated net cash proceeds to the Company of $95.7 million and a gain of $72.3 million.
In March, the Company announced that the previously contracted sale of  220 East 42nd Street, also known as The News Building, which was expected to close in the first quarter, did not move forward due to the buyer’s inability to execute the transaction. The Company has taken action to collect the $35.0 million contract deposit. Collection of the deposit is not reflected in the Company’s revised guidance. The property remains a high-quality asset within the Manhattan office portfolio, is currently 97.0 percent leased and the Company is considering financing alternatives for the property.

In March, the Company entered into a 99-year ground lease of 126-132 Nassau Street, located at the corner of Nassau and Beekman Streets. The Company intends to develop a new, as-of-right, 215,000-square-foot building on the site and has secured a user for a long term net ground lease condominium of the building. The existing 98,412-square-foot office building will be demolished to make way for the new tower.
In January, the Company closed on the acquisition of the remaining 10% interest in 762 Madison Avenue from our joint venture partner at a gross asset valuation of $29.3 million. The Company now owns 100% of the asset.
Debt and Preferred Equity Investment Activity
The carrying value of the Company’s debt and preferred equity investment portfolio increased to $1.85 billion at March 31, 2020, including $1.78 billion of investments at a weighted average current yield of 8.2% that are classified in the debt and preferred equity line item on the balance sheet, and mortgage investments aggregating $0.03 billion at a weighted average current yield of 6.5% that are included in other balance sheet line items for accounting purposes.
During the first quarter, the Company originated mortgages, subordinate debt, and preferred equity investments totaling $511.1 million, all of which was retained and $463.9 million was funded, at a weighted average yield of 8.3%.
During the first quarter, the Company implemented the Current Expected Credit Loss, or CECL, model for recognizing credit losses. Evaluation of the Company’s debt and preferred equity portfolio under this new standard resulted in the Company recording reserves totaling $43.5 million in the first quarter, $39.2 million of which was recorded as a cumulative-effect





adjustment to equity and $4.3 million, of which, or $0.05 per share, was recognized through earnings. In addition, the Company recorded $6.9 million of reserves, or $0.09 per share, through earnings against debt and preferred equity investments that may be sold.
Financing Activity
In February, the Company, along with its joint venture partner, closed on the refinancing of 10 East 53rd Street. The new $220.0 million mortgage, all of which was funded at closing, has a 5-year term, bears interest at a floating rate of 1.35% over LIBOR and replaces the previous $170.0 million of indebtedness on the property that bore interest at a floating rate of 2.25% over LIBOR.
In April, the Company entered into $350.0 million of fixed rate interest swaps against our corporate unsecured debt at a rate of 0.54375% through August 2021.
Guidance
While the ongoing global COVID-19 pandemic did not have a significant impact on our first quarter results, we expect that the Company, and our industry as a whole, will experience a greater impact going forward. Some of the more significant trends we could face during the coming months include: (i) a slowdown in leasing activity and a reduction in market rents; (ii) reduced collections in our owned properties or our debt & preferred equity portfolio; (iii) delays and local restrictions around our development and redevelopment activities; and (iv) increased expenditures related to enhanced safety policies and procedures for our employees and tenants. As a result of these potential trends, the Company is revising its earnings guidance ranges for the year ending December 31, 2020 to net income per share of $1.83 to $2.33 and FFO per share of $6.60 to $7.10 per share.
The following table reconciles the revisions to the Company's guidance ranges for net income per share (diluted) and FFO per share (diluted) for the year ending December 31, 2020:

Net income per share

Funds From Operations per share
Initial Guidance
$
7.43

$
7.53


$
7.25

$
7.35

Real Estate GAAP NOI
0.03

0.16


0.03

0.16

Debt & Preferred Equity Income
(0.34
)
(0.29
)
 
(0.34
)
(0.29
)
Debt & Preferred Equity Reserves
(0.29
)
(0.22
)

(0.29
)
(0.22
)
Other Income, Net
(0.09
)
(0.06
)

(0.09
)
(0.06
)
Interest Expense & Preferred Dividends
(0.05
)
0.05


(0.05
)
0.05

General & Administrative Expense
0.09

0.11


0.09

0.11

Gain on sale of real estate, net
(4.34
)
(4.34
)



Depreciation and Amortization
(0.61
)
(0.61
)



Revised Guidance
$
1.83

$
2.33


$
6.60

$
7.10

Dividends





In the first quarter of 2020, the Company declared:
A dividend on its outstanding common stock of $0.295 per share of common stock, which was paid on April 15, 2020 to shareholders of record on the close of business on March 31, 2020; and
quarterly dividends on its outstanding 6.50% Series I Cumulative Redeemable Preferred Stock of $0.40625 per share for the period January 15, 2020 through and including April 14, 2020, which was paid on April 15, 2020 to shareholders of record on the close of business on March 31, 2020, and reflects the regular quarterly dividend, which is the equivalent of an annualized dividend of $1.625 per share.
Conference Call and Audio Webcast
The Company's executive management team, led by Marc Holliday, Chairman and Chief Executive Officer, will host a conference call and audio webcast on Thursday, April 23, 2020 at 2:00 pm ET to discuss the financial results.
The supplemental data will be available prior to the quarterly conference call in the Investors section of the SL Green Realty Corp. website at https://slgreen.com/ under “Financial Reports.”
The live conference call will be webcast in listen-only mode in the Investors section of the SL Green Realty Corp. website at https://slgreen.com/ under “Presentations & Webcasts”. The conference may also be accessed by dialing toll-free (877) 312-8765 or international (419) 386-0002, and using passcode 5789867.
A replay of the call will be available 7 days after the call by dialing (855) 859-2056 using passcode 5789867. A webcast replay will also be available in the Investors section of the SL Green Realty Corp. website at https://slgreen.com/ under “Presentations & Webcasts”.
Company Profile
SL Green Realty Corp., an S&P 500 company and Manhattan's largest office landlord, is a fully integrated real estate investment trust, or REIT, that is focused primarily on acquiring, managing and maximizing value of Manhattan commercial properties. As of March 31, 2020, SL Green held interests in 102 buildings totaling 49.4 million square feet. This included ownership interests in 28.8 million square feet of Manhattan buildings and 19.6 million square feet securing debt and preferred equity investments.
To be added to the Company's distribution list or to obtain the latest news releases and other Company information, please visit our website at www.slgreen.com or contact Investor Relations at (212) 594-2700.






Disclaimers
Non-GAAP Financial Measures
During the quarterly conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. In addition, the Company has used non-GAAP financial measures in this press release. A reconciliation of each non-GAAP financial measure and the comparable GAAP financial measure can be found in this release and in the Company’s Supplemental Package.

Forward-looking Statements
This press release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbor provisions thereof. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, are forward-looking statements, including the statements herein under the section entitled "Guidance". These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate. Forward-looking statements are not guarantees of future performance and actual results or developments may differ materially, and we caution you not to place undue reliance on such statements. Forward-looking statements are generally identifiable by the use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend," "project," "continue," or the negative of these words, or other similar words or terms.

Forward-looking statements contained in this press release are subject to a number of risks and uncertainties, many of which are beyond our control, that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by forward-looking statements made by us. Factors and risks to our business that could cause actual results to differ from those contained in the forward-looking statements include risks and uncertainties related to the on-going COVID-19 pandemic and the impact it will have on our business and the industry as a whole and the other risks and uncertainties described in our filings with the Securities and Exchange Commission. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of future events, new information or otherwise.





SL GREEN REALTY CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except per share data)
 
Three Months Ended
 
 
March 31,
 
 
2020
 
2019
 
Revenues:
 
 
 
 
Rental revenue, net
$
195,463

 
$
212,639

 
Escalation and reimbursement
27,168

 
27,479

 
Investment income
38,533

 
50,031

 
Other income
53,139

 
14,106

 
        Total revenues
314,303

 
304,255

 
Expenses:
 
 
 
 
Operating expenses, including related party expenses of $3,749 in 2020 and $2,793 in 2019
53,866

 
57,698

 
Real estate taxes
46,622

 
46,688

 
Operating lease rent
7,367

 
8,298

 
Interest expense, net of interest income
37,494

 
50,525

 
Amortization of deferred financing costs
2,500

 
2,742

 
Depreciation and amortization
68,279

 
68,343

 
Loan loss and other investment reserves, net of recoveries
11,248

 

 
Transaction related costs
65

 
55

 
Marketing, general and administrative
19,570

 
25,979

 
        Total expenses
247,011

 
260,328

 
 

 

 
Equity in net loss from unconsolidated joint ventures
(12,814
)
 
(5,234
)
 
Equity in net gain on sale of interest in unconsolidated joint venture/real estate

 
17,166

 
Purchase price and other fair value adjustment

 
(2,041
)
 
Gain (loss) on sale of real estate, net
72,636

 
(1,049
)
 
        Net income
127,114

 
52,769

 
Net income attributable to noncontrolling interests in the Operating Partnership
(6,202
)
 
(2,278
)
 
Net (loss) income attributable to noncontrolling interests in other partnerships
293

 
(237
)
 
Preferred unit distributions
(2,666
)
 
(2,724
)
 
Net income attributable to SL Green
118,539

 
47,530

 
Perpetual preferred stock dividends
(3,738
)
 
(3,738
)
 
        Net income attributable to SL Green common stockholders
$
114,801

 
$
43,792

 
 
 
 
 
 
Earnings Per Share (EPS)
 
 
 
 
Net income per share (Basic)
$
1.47

 
$
0.52

 
Net income per share (Diluted)
$
1.47

 
$
0.52

 
 
 
 
 
 
Funds From Operations (FFO)

 
 
 
FFO per share (Basic)
$
2.09

 
$
1.68

 
FFO per share (Diluted)
$
2.08

 
$
1.68

 
 
 
 
 
 
Basic ownership interest
 
 
 
 
Weighted average REIT common shares for net income per share
78,115

 
83,313

 
Weighted average partnership units held by noncontrolling interests
4,220

 
4,333

 
Basic weighted average shares and units outstanding
82,335

 
87,646

 
 
 
 
 
 
Diluted ownership interest
 
 
 
 
Weighted average REIT common share and common share equivalents
78,347

 
83,477

 
Weighted average partnership units held by noncontrolling interests
4,220

 
4,333

 
Diluted weighted average shares and units outstanding
82,567

 
87,810

 





SL GREEN REALTY CORP.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
 
March 31,
 
December 31,
 
2020
 
2019
Assets
(Unaudited)
 
 
Commercial real estate properties, at cost:
 
 
 
Land and land interests
$
1,662,840

 
$
1,751,544

Building and improvements
5,417,965

 
5,154,990

Building leasehold and improvements
1,435,811

 
1,433,793

Right of use asset - financing leases
163,960

 
47,445

Right of use asset - operating leases
381,255

 
396,795

 
9,061,831

 
8,784,567

Less: accumulated depreciation
(2,130,033
)
 
(2,060,560
)
 
6,931,798

 
6,724,007

Assets held for sale

 
391,664

Cash and cash equivalents
554,195

 
166,070

Restricted cash
66,827

 
75,360

Investment in marketable securities
25,353

 
29,887

Tenant and other receivables, net of allowance of $11,876 and $12,369 in 2020 and 2019, respectively
88,587

 
43,968

Related party receivables
26,092

 
21,121

Deferred rents receivable, net of allowance of $11,711 and $12,477 in 2020 and 2019, respectively
310,138

 
283,011

Debt and preferred equity investments, net of discounts and deferred origination fees of $16,230 and $14,562 and allowances of $37,957 and $1,750 in 2020 and 2019, respectively
1,783,336

 
1,580,306

Investments in unconsolidated joint ventures
2,848,363

 
2,912,842

Deferred costs, net
232,274

 
205,283

Other assets
353,644

 
332,801

        Total assets
$
13,220,607

 
$
12,766,320

 
 
 
 
Liabilities
 
 
 
Mortgages and other loans payable
$
2,010,217

 
$
2,211,883

Revolving credit facility
1,300,000

 
240,000

Unsecured term loan
1,500,000

 
1,500,000

Unsecured notes
1,252,602

 
1,502,837

Deferred financing costs, net
(39,553
)
 
(46,583
)
Total debt, net of deferred financing costs
6,023,266

 
5,408,137

Accrued interest payable
26,377

 
22,148

Accounts payable and accrued expenses
158,750

 
166,905

Deferred revenue
116,197

 
114,052

Lease liability - financing leases
162,299

 
44,448

Lease liability - operating leases
363,990

 
381,671

Dividend and distributions payable
26,563

 
79,282

Security deposits
59,318

 
62,252

Junior subordinate deferrable interest debentures held by trusts that issued trust preferred securities
100,000

 
100,000

Other liabilities
214,968

 
177,080

        Total liabilities
7,251,728

 
6,555,975

 
 
 
 
Commitments and contingencies

 

Noncontrolling interest in the Operating Partnership
358,895

 
409,862

Preferred units
266,019

 
283,285

 
 
 
 
Equity
 
 
 
Stockholders’ equity:
 
 
 
Series I Preferred Stock, $0.01 par value, $25.00 liquidation preference, 9,200 issued and outstanding at both March 31, 2020 and December 31, 2019
221,932

 
221,932

Common stock, $0.01 par value 160,000 shares authorized, 77,591 and 80,257 issued and outstanding at March 31, 2020 and December 31, 2019, respectively (including 1,055 held in Treasury at both March 31, 2020 and December 31, 2019)
776

 
803

Additional paid-in capital
4,146,306

 
4,286,395

Treasury stock at cost
(124,049
)
 
(124,049
)
Accumulated other comprehensive loss
(80,868
)
 
(28,485
)
Retained earnings
1,099,369

 
1,084,719

Total SL Green Realty Corp. stockholders’ equity
5,263,466

 
5,441,315

Noncontrolling interests in other partnerships
80,499

 
75,883

        Total equity
5,343,965

 
5,517,198

Total liabilities and equity
$
13,220,607

 
$
12,766,320






SL GREEN REALTY CORP.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(unaudited and in thousands, except per share data)

 
Three Months Ended
 
 
March 31,
 
Funds From Operations (FFO) Reconciliation:
2020
 
2019
 
 
 
 
 
 
Net income attributable to SL Green common stockholders
$
114,801

 
$
43,792

 
Add:
 
 
 
 
Depreciation and amortization
68,279

 
68,343

 
Joint venture depreciation and noncontrolling interest adjustments
56,318

 
47,625

 
Net income attributable to noncontrolling interests
5,909

 
2,515

 
Less:
 
 
 
 
Gain (loss) on sale of real estate, net
72,636

 
(1,049
)
 
Equity in net gain on sale of interest in unconsolidated joint venture/real estate

 
17,166

 
Purchase price and other fair value adjustments

 
(2,041
)
 
Depreciation on non-rental real estate assets
650

 
707

 
FFO attributable to SL Green common stockholders
$
172,021

 
$
147,492

 


 
Three Months Ended
 
 
March 31,
 
Operating income and Same-store NOI Reconciliation:
2020
 
2019
 
 
 
 
 
 
Net income
$
127,114

 
$
52,769

 
Equity in net gain on sale of interest in unconsolidated joint venture/real estate

 
(17,166
)
 
Purchase price and other fair value adjustments

 
2,041

 
(Gain) loss on sale of real estate, net
(72,636
)
 
1,049

 
Depreciation and amortization
68,279

 
68,343

 
Interest expense, net of interest income
37,494

 
50,525

 
Amortization of deferred financing costs
2,500

 
2,742

 
Operating income
162,751

 
160,303

 
 
 
 
 
 
Equity in net loss from unconsolidated joint ventures
12,814

 
5,234

 
Marketing, general and administrative expense
19,570

 
25,979

 
Transaction related costs, net
65

 
55

 
Investment income
(38,533
)
 
(50,031
)
 
Loan loss and other investment reserves, net of recoveries
11,248

 

 
Non-building revenue
(3,790
)
 
(9,144
)
 
Loss on early extinguishment of debt

 

 
Net operating income (NOI)
164,125

 
132,396

 
 
 
 
 
 
Equity in net loss from unconsolidated joint ventures
(12,814
)
 
(5,234
)
 
SLG share of unconsolidated JV depreciation and amortization
45,874

 
48,128

 
SLG share of unconsolidated JV interest expense, net of interest income
35,777

 
39,407

 
SLG share of unconsolidated JV amortization of deferred financing costs
1,687

 
1,568

 
SLG share of unconsolidated JV investment income
(307
)
 
(2,227
)
 
SLG share of unconsolidated JV non-building revenue
(1,599
)
 
(711
)
 
NOI including SLG share of unconsolidated JVs
232,743

 
213,327

 
 
 
 
 
 
NOI from other properties/affiliates
(54,596
)
 
(33,147
)
 
Same-Store NOI
178,147

 
180,180

 
 
 
 
 
 
Ground lease straight-line adjustment
429

 
514

 
Joint Venture ground lease straight-line adjustment
342

 
393

 
Straight-line and free rent
(1,672
)
 
(4,758
)
 
Amortization of acquired above and below-market leases, net
(2,376
)
 
(1,237
)
 
Joint Venture straight-line and free rent
(5,802
)
 
(16,595
)
 
Joint Venture amortization of acquired above and below-market leases, net
(3,827
)
 
(4,262
)
 
Same-store cash NOI
$
165,241

 
$
154,235

 





SL GREEN REALTY CORP.
NON-GAAP FINANCIAL MEASURES - DISCLOSURES
Funds from Operations (FFO)
FFO is a widely recognized non-GAAP financial measure of REIT performance. The Company computes FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The revised White Paper on FFO approved by the Board of Governors of NAREIT in April 2002, and subsequently amended, defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of properties, and real estate related impairment charges, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.
The Company presents FFO because it considers it an important supplemental measure of the Company’s operating performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, particularly those that own and operate commercial office properties. The Company also uses FFO as one of several criteria to determine performance-based bonuses for members of its senior management. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions, and real estate related impairment charges, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, and interest costs, providing perspective not immediately apparent from net income. FFO does not represent cash generated from operating activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance or to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity, nor is it indicative of funds available to fund the Company’s cash needs, including our ability to make cash distributions.
Funds Available for Distribution (FAD)
FAD is a non-GAAP financial measure that is calculated as FFO plus non-real estate depreciation, allowance for straight line credit loss, adjustment for straight line operating lease rent, non-cash deferred compensation, and a pro-rata adjustment for FAD from SLG’s unconsolidated JVs, less straight line rental income, free rent net of amortization, second cycle tenant improvement and leasing costs, and recurring building improvements.
FAD is not intended to represent cash flow for the period and is not indicative of cash flow provided by operating activities as determined in accordance with GAAP. FAD is presented solely as a supplemental disclosure with respect to liquidity because the Company believes it provides useful information regarding the Company’s ability to fund its dividends. Because all companies do not calculate FAD the same way, the presentation of FAD may not be comparable to similarly titled measures of other companies. FAD does not represent cash flow from operating, investing and finance activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of the Company’s liquidity.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre)
EBITDAre is a non-GAAP financial measure. The Company computes EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which may not be comparable to EBITDAre reported by other REITs that do not compute EBITDAre in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The White Paper on EBITDAre approved by the Board of Governors of NAREIT in September 2017 defines EBITDAre as net income (loss) (computed in accordance with Generally Accepted Accounting Principles, or GAAP), plus interest expense, plus income tax expense, plus depreciation and amortization, plus (minus) losses and gains on the disposition of depreciated property, plus impairment write-downs of depreciated property and investments in unconsolidated joint ventures, plus adjustments to reflect the entity's share of EBITDAre of unconsolidated joint ventures.
The Company presents EBITDAre because the Company believes that EBITDAre, along with cash flow from operating activities, investing activities and financing activities, provides investors with an additional indicator of the Company’s ability to incur and service debt. EBITDAre should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of the Company’s liquidity.
Net Operating Income (NOI) and Cash NOI
NOI is a non-GAAP financial measure that is calculated as operating income before transaction related costs, gains/losses on early extinguishment of debt, marketing general and administrative expenses and non-real estate revenue. Cash NOI is also a non-GAAP financial measure that is calculated by subtracting free rent (net of amortization), straight-line rent, and the amortization of acquired above and below-market leases from NOI, while adding operating lease straight-line adjustment and the allowance for straight-line tenant credit loss.
The Company presents NOI and Cash NOI because the Company believes that these measures, when taken together with the corresponding GAAP financial measures and our reconciliations, provide investors with meaningful information regarding the operating performance of properties. When operating performance is compared across multiple periods, the investor is provided with information not immediately apparent from net income that is determined in accordance with GAAP. NOI and Cash NOI provide information on trends in the revenue generated and expenses incurred in operating our properties, unaffected by the cost of leverage, straight-line adjustments, depreciation, amortization, and other net income components. The Company uses these metrics internally as performance measures. None of these measures is an alternative to net income (determined in accordance with GAAP) and same-store performance should not be considered an alternative to GAAP net income performance.
Coverage Ratios
The Company presents fixed charge and debt service coverage ratios to provide a measure of the Company’s financial flexibility to service current debt amortization, interest expense and operating lease rent from current cash net operating income. These coverage ratios represent a common measure of the Company’s ability to service fixed cash payments; however, these ratios are not used as an alternative to cash flow from operating, financing and investing activities (determined in accordance with GAAP).
SLG EARN



EX-99.2 3 a20q1supplemental.htm EXHIBIT 99.2 Exhibit


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SL Green Realty Corp. is a self-managed real estate investment trust, or REIT, with in-house capabilities in property management, acquisitions and dispositions, financing, development, redevelopment, construction and leasing.
As of March 31, 2020, the Company held interests in 102 buildings totaling 49.4 million square feet. This included ownership interests in 28.8 million square feet in Manhattan buildings and 19.6 million square feet securing debt and preferred equity investments.
SL Green’s common stock is listed on the New York Stock Exchange and trades under the symbol SLG.
SL Green maintains a website at https://slgreen.com where key investor relations data can be found. This supplemental financial package is available through the Company’s website.
This data is furnished to supplement audited and unaudited regulatory filings of the Company and should be read in conjunction with those filings. The financial data herein is unaudited and is provided to assist readers of quarterly and annual financial filings and should not be read in replacement of, or superior to, such financial filings. As such, data otherwise contained in future regulatory filings covering the same period may restate the data presented herein.
Questions pertaining to the information contained herein should be referred to Investor Relations at investor.relations@slgreen.com or at 212-594-2700.
Ratings
Ratings are not recommendations to buy, sell or hold the Company’s securities.










 
Forward-looking Statements
This supplemental reporting package includes certain statements that may be deemed to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbor provisions thereof. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, are forward-looking statements, including the statements herein under the section entitled "Guidance". These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate. Forward-looking statements are not guarantees of future performance and actual results or developments may differ materially, and we caution you not to place undue reliance on such statements. Forward-looking statements are generally identifiable by the use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend," "project," "continue," or the negative of these words, or other similar words or terms.

Forward-looking statements contained in this press release are subject to a number of risks and uncertainties, many of which are beyond our control, that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by forward-looking statements made by us. Factors and risks to our business that could cause actual results to differ from those contained in the forward-looking statements include risks and uncertainties related to the on-going COVID-19 pandemic and the impact it will have on our business and the industry as a whole and the other risks and uncertainties described in our filings with the Securities and Exchange Commission. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of future events, new information or otherwise.

The following discussion related to the consolidated financial statements of the Company should be read in conjunction with the financial statements for the year ended March 31, 2020 that will be released on Form 10-Q to be filed on or before May 11, 2020.

Supplemental Information
2
First Quarter 2020

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TABLE OF CONTENTS


 
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Supplemental Definitions
 
 
 
 
Highlights
-
 
 
 
 
Comparative Balance Sheets
 
 
Comparative Statements of Operations
 
 
Comparative Computation of FFO and FAD
 
 
Consolidated Statement of Equity
 
 
 
 
Joint Venture Statements
-
 
 
 
 
Selected Financial Data
-
 
 
 
 
Debt Summary Schedule
-
 
 
 
 
Lease Liability Schedule
 
 
 
 
Debt and Preferred Equity Investments
-
 
 
 
 
Selected Property Data
 
 
 
Composition of Property Portfolio
-
Largest Tenants
Tenant Diversification
Leasing Activity Summary
-
Annual Lease Expirations
-
 
 
 
 
Summary of Real Estate Acquisition/Disposition Activity
-
 
 
 
 
Corporate Information
 
 
Non-GAAP Disclosures and Reconciliations
 
 
Analyst Coverage



Supplemental Information
3
First Quarter 2020

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SUPPLEMENTAL DEFINITIONS
                               
                          
                         
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Annualized cash rent - Monthly base rent and escalations per the lease, as of the last day of the quarter, multiplied by 12.
Capitalized Interest - The total of i) interest cost for project specific debt on properties that are under development or redevelopment plus ii) an imputed interest cost for properties that are under development or redevelopment, which is calculated based on the Company’s equity investment in those properties multiplied by the Company’s weighted average corporate borrowing rate.  Capitalized Interest is a component of the book basis in a development or redevelopment property.
Debt service coverage - Operating Income adding back income taxes, loan loss reserves and our share of joint venture depreciation and amortization, divided by total interest and principal payments.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre) - EBITDAre is a non-GAAP financial measure. The Company computes EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which may not be comparable to EBITDAre reported by other REITs that do not compute EBITDAre in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The White Paper on EBITDAre approved by the Board of Governors of NAREIT in September 2017 defines EBITDAre as net income (loss) (computed in accordance with Generally Accepted Accounting Principles, or GAAP), plus interest expense, plus income tax expense, plus depreciation and amortization, plus (minus) losses and gains on the disposition of depreciated property, plus impairment write-downs of depreciated property and investments in unconsolidated joint ventures, plus adjustments to reflect the entity's share of EBITDAre of unconsolidated joint ventures.
First generation TIs and LCs - Tenant improvements (TIs), leasing commissions (LCs), and other leasing costs that were taken into consideration when underwriting the acquisition of a property, which are generally incurred during the first 4-5 years following acquisition.
Fixed charge - Total payments for interest, loan principal amortization, ground rent and preferred stock dividends.
Fixed charge coverage - Operating Income adding back income taxes, loan loss reserves and our share of joint venture depreciation and amortization, divided by Fixed Charge.
Funds Available for Distribution (FAD) - FAD is a non-GAAP financial measure that is calculated as FFO plus non-real estate depreciation, allowance for straight line credit loss, adjustment for straight line operating lease rent, non-cash deferred compensation, and a pro-rata adjustment for FAD from SLG’s unconsolidated JVs, less straight line rental income, free rent net of amortization, second cycle tenant improvement and leasing costs, and recurring building improvements.
Funds from Operations (FFO) - FFO is a widely recognized non-GAAP financial measure of REIT performance. The Company computes FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The revised White Paper on FFO approved by the Board of Governors of NAREIT in April 2002, and subsequently amended, defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of properties, and real estate related impairment charges, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.
 
Junior Mortgage Participations - Subordinate interests in first mortgages.
Mezzanine Debt - Loans secured by ownership interests in real estate.
Net Operating Income (NOI) and Cash NOI - NOI is a non-GAAP financial measure that is calculated as operating income before transaction related costs, gains/losses on early extinguishment of debt, marketing general and administrative expenses and non-real estate revenue. Cash NOI is also a non-GAAP financial measure that is calculated by subtracting free rent (net of amortization), straight-line rent, and the amortization of acquired above and below-market leases from NOI, while adding operating lease straight-line adjustment and the allowance for straight-line tenant credit loss.
Preferred Equity Investments - Equity investments that are senior to common equity and are entitled to preferential returns.
Recurring capital expenditures - Building improvements and leasing costs required to maintain current revenues. Recurring capital expenditures do not include building improvements that were taken into consideration when underwriting the purchase of a building or which are incurred to bring a building up to “operating standards.”
Redevelopment costs - Non-recurring capital expenditures incurred to improve buildings to SLG’s “operating standards.”
Right of Use Assets / Lease Liabilities - Represents the right to control the use of leased property and the corresponding obligation, both measured, at inception, as the present value of the lease payments. The asset and related liability are classified as either operating or financing based on the length and cost of the lease and whether the lease contains a purchase option or a transfer of ownership. Operating leases are expensed through operating lease rent while financing leases are expensed through amortization and interest expense. On our balance sheets, financing leases include the amounts previously captioned "Properties under capital lease."
Same-Store Properties (Same-Store) - Properties owned in the same manner during both the current and prior year, excluding development properties that are not stabilized for both the current and prior year. Changes to Same-Store properties in 2019 are as follows:
Added to Same-Store in 2020:
Removed from Same-Store in 2020:
2 Herald Square
One Madison Avenue (redevelopment)
719 Seventh Avenue
625 Madison Avenue (redevelopment)
650 Fifth Avenue
315 West 34th Street "The Olivia" (disposed)
 
762 Madison Avenue (redevelopment)
Second generation TIs and LCs - Tenant improvements, leasing commissions, and other leasing costs that do not meet the definition of first generation TIs and LCs.
SLG Interest - 'SLG Share' or 'Share of JV' is computed by multiplying the referenced line item by the Company's percentage ownership in the respective joint ventures and may not accurately depict the legal and economic implications of holding a non-controlling interest in the joint ventures.
Total square feet owned - The total square footage of properties either owned directly by SLG or in which SLG has a joint venture interest.

Supplemental Information
4
First Quarter 2020

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FIRST QUARTER 2020 HIGHLIGHTS

Unaudited

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New York, NY, April 22, 2020 - SL Green Realty Corp. (the "Company") (NYSE: SLG) today reported net income attributable to common stockholders for the quarter ended March 31, 2020 of $114.8 million, or $1.47 per share, as compared to net income attributable to common stockholders of $43.8 million, or $0.52 per share, for the same quarter in 2019. Net income attributable to common stockholders for the first quarter of 2020 includes $72.3 million, or $0.88 per share, of net gains recognized from the sale of The Olivia.
The Company reported FFO for the quarter ended March 31, 2020 of $172.0 million, or $2.08 per share, which includes the recognition of $37.7 million, or $0.46 per share, of incremental income from Credit Suisse at 1 Madison Avenue representing rent through December 31, 2020, offset by $11.2 million, or $0.14 per share, of reserves against the Company’s debt and preferred equity portfolio related to the potential sale of certain investments and implementation of the new Current Expected Credit Loss, or CECL, regulation. FFO for the same period in 2019 was $147.5 million, or $1.68 per share.
All per share amounts are presented on a diluted basis.
Operating and Leasing Activity
For the quarter ended March 31, 2020, the Company reported consolidated revenues and operating income of $314.3 million and $162.8 million, respectively, compared to $304.3 million and $160.3 million, respectively, for the same period in 2019.
Same-store cash NOI, including our share of same-store cash NOI from unconsolidated joint ventures increased by 0.7% for the first quarter, excluding lease termination income and free rent to Viacom at 1515 Broadway.
During the first quarter, the Company signed 30 office leases in its Manhattan portfolio totaling 316,154 square feet. Twenty-one leases comprising 181,600 square feet, representing office leases on space that had been occupied within the prior twelve months, are considered replacement leases on which mark-to-market is calculated. Those replacement leases had average starting rents of $70.68 per rentable square foot, representing a 12.6% increase over the previous fully escalated rents on the same office spaces. The average lease term on the Manhattan office leases signed in the first quarter was 10.1 years and average tenant concessions were 2.0 months of free rent with a tenant improvement allowance of $28.54 per rentable square foot.
Occupancy in the Company's Manhattan same-store portfolio was 95.5% as of March 31, 2020, inclusive of 404,018 square feet of leases signed but not yet commenced, as compared to 95.4% as of March 31, 2019.
Significant leases that were signed in the first quarter included:
Renewal and expansion with Hudson Yards Construction LLC for 75,704 square feet at 410 10th Avenue, for 21.1 years;
New lease with Memorial Hospital for Cancer and Allied Diseases for 54,199 square feet at 485 Lexington Avenue, for 10.0 years;
New lease with City Garage for 44,201 square feet at 810 Seventh Avenue, for 10.0 years; and
New lease with KCP Holdco, Inc. for 37,169 square feet at 707 Eleventh Avenue, for 10.0 years.
 
Investment Activity
To date in 2020, the Company has repurchased a combined 2.6 million shares of common stock and common units of its Operating Partnership, or OP units, under the previously announced $3.0 billion share repurchase plan, at an average price of $83.25 per share/unit. Since inception of the program, the Company has repurchased a total of 25.3 million shares of its common stock under the program and redeemed 0.4 million OP units, allowing the Company to save approximately $91.2 million of common dividends and distributions on an annualized basis. The average price of total share repurchases and OP Unit redemptions to date is $94.46 per share/unit. The Company has curtailed its share repurchase program until additional sources of liquidity from asset sales or internal free cash flow are established.
In March, the Company closed on the sale of 315 West 33rd Street, known as The Olivia, and an adjacent, undeveloped parcel of land for a sale price of $446.5 million, or approximately $906 per square foot. The Company acquired the 36-story, 492,987-square-foot building in 2013. The mixed-use property includes 333 residential units with occupancy over 96 percent and 270,132 square feet of commercial space, which is 100 percent occupied. Commercial tenants include AMC Theater, Music Choice and Landmark Education. The transaction included a $100 million preferred equity investment by the Company, which was part of the original contract terms, and generated net cash proceeds to the Company of $95.7 million and a gain of $72.3 million.
In March, the Company announced that the previously contracted sale of 220 East 42nd Street, also known as The News Building, which was expected to close in the first quarter, did not move forward due to the buyer’s inability to execute the transaction. The Company has taken action to collect the $35.0 million contract deposit. Collection of the deposit is not reflected in the Company’s revised guidance. The property remains a high-quality asset within the Manhattan office portfolio, is currently 97.0 percent leased and the Company is considering financing alternatives for the property.

In March, the Company entered into a 99-year ground lease of 126-132 Nassau Street, located at the corner of Nassau and Beekman Streets. The Company intends to develop a new, as-of-right, 215,000-square-foot building on the site and has secured a user for a long term net ground lease condominium of the building. The existing 98,412-square-foot office building will be demolished to make way for the new tower.
In January, the Company closed on the acquisition of the remaining 10% interest in 762 Madison Avenue from our joint venture partner at a gross asset valuation of $29.3 million. The Company now owns 100% of the asset.
Debt and Preferred Equity Investment Activity
The carrying value of the Company’s debt and preferred equity investment portfolio increased to $1.85 billion at March 31, 2020, including $1.78 billion of investments at a weighted average current yield of 8.2% that are classified in the debt and preferred equity line item on the balance sheet, and mortgage investments aggregating $0.03 billion at a weighted average current yield of 6.5% that are included in other balance sheet line items for accounting purposes.
During the first quarter, the Company originated mortgages, subordinate debt, and preferred equity investments totaling $511.1 million, all of which was retained and $463.9 million was funded, at a weighted average yield of 8.3%.

Supplemental Information
5
First Quarter 2020

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FIRST QUARTER 2020 HIGHLIGHTS

Unaudited

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During the first quarter, the Company implemented the Current Expected Credit Loss, or CECL, model for recognizing credit losses. Evaluation of the Company’s debt and preferred equity portfolio under this new standard resulted in the Company recording reserves totaling $43.5 million in the first quarter, $39.2 million of which was recorded as a cumulative-effect adjustment to equity and $4.3 million, of which, or $0.05 per share, was recognized through earnings. In addition, the Company recorded $6.9 million of reserves, or $0.09 per share, through earnings against debt and preferred equity investments that may be sold.
Financing Activity
In February, the Company, along with its joint venture partner, closed on the refinancing of 10 East 53rd Street. The new $220.0 million mortgage, all of which was funded at closing, has a 5-year term, bears interest at a floating rate of 1.35% over LIBOR and replaces the previous $170.0 million of indebtedness on the property that bore interest at a floating rate of 2.25% over LIBOR.
In April, the Company entered into $350.0 million of fixed rate interest swaps against our corporate unsecured debt at a rate of 0.54375% through August 2021.
Guidance
While the ongoing global COVID-19 pandemic did not have a significant impact on our first quarter results, we expect that the Company, and our industry as a whole, will experience a greater impact going forward. Some of the more significant trends we could face during the coming months include: (i) a slowdown in leasing activity and a reduction in market rents; (ii) reduced collections in our owned properties or our debt & preferred equity portfolio; (iii) delays and local restrictions around our development and redevelopment activities; and (iv) increased expenditures related to enhanced safety policies and procedures for our employees and tenants. As a result of these potential trends, the Company is revising its earnings guidance ranges for the year ending December 31, 2020 to net income per share of $1.83 to $2.33 and FFO per share of $6.60 to $7.10 per share.
 
The following table reconciles the revisions to the Company's guidance ranges for net income per share (diluted) and FFO per share (diluted) for the year ending December 31, 2020:

Net income per share

Funds From Operations per share
Initial Guidance
$
7.43

$
7.53


$
7.25

$
7.35

Real Estate GAAP NOI
0.03

0.16


0.03

0.16

Debt & Preferred Equity Income
(0.34
)
(0.29
)
 
(0.34
)
(0.29
)
Debt & Preferred Equity Reserves
(0.29
)
(0.22
)

(0.29
)
(0.22
)
Other Income, Net
(0.09
)
(0.06
)

(0.09
)
(0.06
)
Interest Expense & Preferred Dividends
(0.05
)
0.05


(0.05
)
0.05

General & Administrative Expense
0.09

0.11


0.09

0.11

Gain on sale of real estate, net
(4.34
)
(4.34
)



Depreciation and Amortization
(0.61
)
(0.61
)



Revised Guidance
$
1.83

$
2.33


$
6.60

$
7.10

Dividends
In the first quarter of 2020, the Company declared:
A dividend on its outstanding common stock of $0.295 per share of common stock, which was paid on April 15, 2020 to shareholders of record on the close of business on March 31, 2020; and
quarterly dividends on its outstanding 6.50% Series I Cumulative Redeemable Preferred Stock of $0.40625 per share for the period January 15, 2020 through and including April 14, 2020, which was paid on April 15, 2020 to shareholders of record on the close of business on March 31, 2020, and reflects the regular quarterly dividend, which is the equivalent of an annualized dividend of $1.625 per share.
Conference Call and Audio Webcast
The Company's executive management team, led by Marc Holliday, Chairman and Chief Executive Officer, will host a conference call and audio webcast on Thursday, April 23, 2020 at 2:00 pm ET to discuss the financial results.
The supplemental data will be available prior to the quarterly conference call in the Investors section of the SL Green Realty Corp. website at https://slgreen.com/ under “Financial Reports.”
The live conference call will be webcast in listen-only mode in the Investors section of the SL Green Realty Corp. website at https://slgreen.com/ under “Presentations & Webcasts”. The conference may also be accessed by dialing toll-free (877) 312-8765 or international (419) 386-0002, and using passcode 5789867.
A replay of the call will be available 7 days after the call by dialing (855) 859-2056 using passcode 5789867. A webcast replay will also be available in the Investors section of the SL Green Realty Corp. website at https://slgreen.com/ under “Presentations & Webcasts”.

Supplemental Information
6
First Quarter 2020

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KEY FINANCIAL DATA

Unaudited
(Dollars in Thousands Except Per Share)
 
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As of or for the three months ended
 
3/31/2020
 
12/31/2019
 
9/30/2019
 
6/30/2019
 
3/31/2019
 
 
 
 
 
 
 
 
 
 
Earnings Per Share
 
 
 
 
 
 
 
 
 
Net income available to common stockholders - diluted
$
1.47

 
$
0.22

 
$
0.40

 
$
1.94

 
$
0.52

Funds from operations (FFO) available to common stockholders - diluted
$
2.08

 
$
1.75

 
$
1.75

 
$
1.82

 
$
1.68

 
 
 
 
 
 
 
 
 
 
Common Share Price & Dividends
 
 
 
 
 
 
 
 
 
Closing price at the end of the period
$
43.10

 
$
91.88

 
$
81.75

 
$
80.37

 
$
89.92

Closing high price during period
$
95.77

 
$
92.90

 
$
83.38

 
$
92.60

 
$
93.47

Closing low price during period
$
41.14

 
$
78.50

 
$
76.79

 
$
79.59

 
$
77.46

Common dividend per share
$
0.2950

(1) 
$
0.8850

 
$
0.8500

 
$
0.8500

 
$
0.8500

 
 
 
 
 
 
 
 
 
 
FFO payout ratio (trailing 12 months)
46.9
%
 
49.1
%
 
49.6
%
 
49.7%

 
50.1%

Funds available for distribution (FAD) payout ratio (trailing 12 months)
73.6
%
 
72.9
%
 
92.5
%
 
87.3%

 
83.9%

 
 
 
 
 
 
 
 
 
 
Common Shares & Units
 
 
 
 
 
 
 
 
 
Common shares outstanding
76,535

 
79,202

 
81,515

 
82,409

 
83,272

Units outstanding
4,145

 
4,196

 
4,258

 
4,259

 
4,261

Total common shares and units outstanding
80,680

 
83,398

 
85,773

 
86,668

 
87,533

 
 
 
 
 
 
 
 
 
 
Weighted average common shares and units outstanding - basic
82,335

 
83,767

 
86,550

 
87,231

 
87,646

Weighted average common shares and units outstanding - diluted
82,567

 
84,320

 
86,714

 
87,398

 
87,810

 
 
 
 
 
 
 
 
 
 
Market Capitalization
 
 
 
 
 
 
 
 
 
Market value of common equity
$
3,477,308

 
$
7,662,608

 
$
7,011,943

 
$
6,965,507

 
$
7,870,967

Liquidation value of preferred equity/units
496,020

 
513,285

 
516,285

 
516,285

 
515,285

Consolidated debt
6,162,819

 
5,554,720

 
5,892,756

 
6,140,212

 
5,940,440

Consolidated market capitalization
$
10,136,147

 
$
13,730,613

 
$
13,420,984

 
$
13,622,004

 
$
14,326,692

SLG share of unconsolidated JV debt
4,132,083

 
4,028,136

 
3,930,470

 
3,799,897

 
3,815,230

Market capitalization including SLG share of unconsolidated JVs
$
14,268,230

 
$
17,758,749

 
$
17,351,454

 
$
17,421,901

 
$
18,141,922

 
 
 
 
 
 
 
 
 
 
Consolidated debt service coverage (trailing 12 months)
3.39x

 
3.37x

 
3.26x

 
3.20x

 
3.10x

Consolidated fixed charge coverage (trailing 12 months)
2.77x

 
2.74x

 
2.68x

 
2.63x

 
2.57x

Debt service coverage, including SLG share of unconsolidated JVs (trailing 12 months)
2.41x

 
2.39x

 
2.35x

 
2.34x

 
2.30x

Fixed charge coverage, including SLG share of unconsolidated JVs (trailing 12 months)
2.08x

 
2.06x

 
2.03x

 
2.03x

 
2.00x

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) In March 2020 the Company modified its dividend policy from quarterly payments to monthly payments to allow better matching of its distributions to the operating cash flow it recognizes in the current market environment



Supplemental Information
7
First Quarter 2020

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KEY FINANCIAL DATA

Unaudited
(Dollars in Thousands Except Per Share)
 
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As of or for the three months ended
 
3/31/2020
 
12/31/2019
 
9/30/2019
 
6/30/2019
 
3/31/2019
 
 
 
 
 
 
 
 
 
 
Selected Balance Sheet Data
 
 
 
 
 
 
 
 
 
Real estate assets before depreciation
$
9,061,831

 
$
9,222,796

 
$
9,560,878

 
$
9,550,222

 
$
8,936,493

Investments in unconsolidated joint ventures
$
2,848,363

 
$
2,912,842

 
$
2,923,595

 
$
2,937,153

 
$
3,055,368

Debt and preferred equity investments
$
1,783,336

 
$
1,580,306

 
$
1,954,556

 
$
2,228,912

 
$
2,272,241

Cash and cash equivalents
$
554,195

 
$
166,070

 
$
121,751

 
$
148,978

 
$
144,323

Investment in marketable securities
$
25,353

 
$
29,887

 
$
30,208

 
$
29,978

 
$
29,406

 
 
 
 
 
 
 
 
 
 
Total assets
$
13,220,607

 
$
12,766,320

 
$
13,294,984

 
$
13,629,941

 
$
13,385,774

 
 
 
 
 
 
 
 
 
 
Fixed rate & hedged debt
$
3,032,513

 
$
3,536,286

 
$
3,538,829

 
$
3,540,487

 
$
3,542,126

Variable rate debt
3,130,306

(1) 
2,018,434

 
2,353,927

 
2,599,725

 
2,398,314

Total consolidated debt
$
6,162,819

 
$
5,554,720

 
$
5,892,756


$
6,140,212


$
5,940,440

Deferred financing costs, net of amortization
(39,553
)
 
(46,583
)
 
(56,988
)
 
(57,423
)
 
(50,376
)
Total consolidated debt, net
$
6,123,266

 
$
5,508,137

 
$
5,835,768

 
$
6,082,789

 
$
5,890,064

 
 
 
 
 
 
 
 
 
 
Total liabilities
$
7,251,728

 
$
6,555,975

 
$
6,843,536

 
$
7,062,331

 
$
6,843,805

 
 
 
 
 
 
 
 
 
 
Fixed rate & hedged debt, including SLG share of unconsolidated JV debt
$
5,265,219

 
$
5,771,749

 
$
5,777,022

 
$
5,781,333

 
$
5,880,322

Variable rate debt, including SLG share of unconsolidated JV debt
5,029,683

(1) 
3,811,107

 
4,046,204

 
4,158,776

 
3,875,348

Total debt, including SLG share of unconsolidated JV debt
$
10,294,902

 
$
9,582,856

 
$
9,823,226

 
$
9,940,109

 
$
9,755,670

 
 
 
 
 
 
 
 
 
 
Selected Operating Data
 
 
 
 
 
 
 
 
 
Property operating revenues
$
222,631

 
$
250,452

 
$
248,028

 
$
244,959

 
$
240,118

Property operating expenses
(107,855
)
 
(114,867
)
 
(117,768
)
 
(113,309
)
 
(112,684
)
Property NOI
$
114,776

 
$
135,585

 
$
130,260

 
$
131,650

 
$
127,434

SLG share of unconsolidated JV Property NOI
73,992

 
72,123

 
75,442

 
78,472

 
80,635

Property NOI, including SLG share of unconsolidated JV Property NOI
$
188,768

 
$
207,708

 
$
205,702

 
$
210,122

 
$
208,069

Investment income
38,533

 
42,423

 
51,518

 
51,618

 
50,031

Other income
53,139

 
15,207

 
14,088

 
16,447

 
14,106

Marketing general & administrative expenses
(19,570
)
 
(25,575
)
 
(23,841
)
 
(25,480
)
 
(25,979
)
SLG share of investment income and other income from unconsolidated JVs
1,918

 
1,736

 
1,437

 
2,141

 
3,291

Income taxes
1,134

 
1,027

 
(995
)
 
680

 
770

Transaction costs, including SLG share of unconsolidated JVs
(65
)
 
(369
)
 
(44
)
 
(261
)
 
(55
)
Loan loss and other investment reserves, net of recoveries
(11,248
)
 

 

 

 

EBITDAre
$
252,609

 
$
242,157

 
$
247,865

 
$
255,267

 
$
250,233

 
 
 
 
 
 
 
 
 
 
(1) Does not reflect $0.8 billion of floating rate debt and preferred equity investments that provide a hedge against floating rate debt.
 

Supplemental Information
8
First Quarter 2020

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KEY FINANCIAL DATA
Manhattan Properties (1)
Unaudited
(Dollars in Thousands Except Per Share)
 
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As of or for the three months ended
 
3/31/2020
 
12/31/2019
 
9/30/2019
 
6/30/2019
 
3/31/2019
 
 
 
 
 
 
 
 
 
 
Selected Operating Data
 
 
 
 
 
 
 
 
 
Property operating revenues
$
214,373

 
$
233,500

 
$
230,443

 
$
227,427

 
$
222,780

Property operating expenses
97,312

 
100,672

 
101,871

 
97,927

 
98,198

Property NOI
$
117,061

 
$
132,828

 
$
128,572

 
$
129,500

 
$
124,582

 
 
 
 
 
 
 
 
 
 
Other income - consolidated
$
45,348

 
$
3,128

 
$
6,210

 
$
4,493

 
$
4,572

 
 
 
 
 
 
 
 
 
 
SLG share of property NOI from unconsolidated JVs
$
73,992

 
$
72,111

 
$
76,552

 
$
78,979

 
$
80,636

 
 
 
 
 
 
 
 
 
 
Portfolio Statistics
 
 
 
 
 
 
 
 
 
Consolidated office buildings in service
18

 
20

 
20

 
20

 
20

Unconsolidated office buildings in service
10

 
10

 
10

 
10

 
11

 
28

 
30

 
30

 
30

 
31

 
 
 
 
 
 
 
 
 
 
Consolidated office buildings in service - square footage
10,647,191

 
12,387,091

 
12,387,091

 
12,387,091

 
12,387,091

Unconsolidated office buildings in service - square footage
11,216,183

 
11,216,183

 
11,216,183

 
11,216,183

 
11,676,183

 
21,863,374

 
23,603,274

 
23,603,274

 
23,603,274

 
24,063,274

 
 
 
 
 
 
 
 
 
 
Same-Store office occupancy inclusive of leases signed not yet commenced
95.5%
 
96.0%
 
95.0%
 
94.8%
 
95.4%
 
 
 
 
 
 
 
 
 
 
Office Leasing Statistics
 
 
 
 
 
 
 
 
 
New leases commenced
27

 
19

 
27

 
25

 
25

Renewal leases commenced
5

 
19

 
9

 
7

 
10

Total office leases commenced
32

 
38

 
36

 
32

 
35

 
 
 
 
 
 
 
 
 
 
Commenced office square footage filling vacancy
29,938

 
122,564

 
170,062

 
74,425

 
132,241

Commenced office square footage on previously occupied space (M-T-M leasing) (2)
136,523

 
415,750

 
181,226

 
279,649

 
270,602

Total office square footage commenced
166,461

 
538,314

 
351,288

 
354,074

 
402,843

 
 
 
 
 
 
 
 
 
 
Average starting cash rent psf - office leases commenced
$68.33
 
$64.95
 
$77.09
 
$70.53
 
$69.38
Previous escalated cash rent psf - office leases commenced (3)
$73.52
 
$48.03
 
$73.39
 
$62.82
 
$67.90
Increase in new cash rent over previously escalated cash rent (2) (3)
(7.1)%
 
35.2%
 
5.0%
 
12.3%
 
2.2%
Average lease term
11.3
 
7.4
 
16.1
 
11.5
 
11.0
Tenant concession packages psf
$60.30
 
$37.38
 
$77.97
 
$79.94
 
$67.08
Free rent months
6.0
 
4.4
 
4.4
 
7.1
 
5.7
 
 
 
 
 
 
 
 
 
 
(1) Property data includes operating office, retail, residential, development, and redevelopment properties.
(2) Calculated on space that was occupied within the previous 12 months.
(3) Escalated cash rent includes base rent plus all additional amounts paid by the tenant in the form of real estate taxes, operating expenses, porters wage or a consumer price index (CPI) adjustment.

Supplemental Information
9
First Quarter 2020

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COMPARATIVE BALANCE SHEETS

Unaudited
(Dollars in Thousands)
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As of
 
3/31/2020
 
12/31/2019
 
9/30/2019
 
6/30/2019
 
3/31/2019
Assets
 
 
 
 
 
 
 
 
 
Commercial real estate properties, at cost:
 
 
 
 
 
 
 
 
 
     Land and land interests
$
1,662,840

 
$
1,751,544

 
$
1,860,922

 
$
1,929,496

 
$
1,775,006

     Building and improvements
5,417,965

 
5,154,990

 
5,352,144

 
5,749,261

 
5,294,612

     Building leasehold and improvements
1,435,811

 
1,433,793

 
1,431,183

 
1,427,225

 
1,423,282

     Right of use asset - financing leases
163,960

 
47,445

 
47,445

 
47,445

 
47,445

     Right of use asset - operating leases
381,255

 
396,795

 
396,795

 
396,795

 
396,148

 
9,061,831

 
8,784,567

 
9,088,489

 
9,550,222

 
8,936,493

Less: accumulated depreciation
(2,130,033
)
 
(2,060,560
)
 
(2,147,395
)
 
(2,217,013
)
 
(2,154,075
)
Net real estate
6,931,798

 
6,724,007

 
6,941,094

 
7,333,209

 
6,782,418

 
 
 
 
 
 
 
 
 
 
Other real estate investments:
 
 
 
 
 
 
 
 
 
    Investment in unconsolidated joint ventures
2,848,363

 
2,912,842

 
2,923,595

 
2,937,153

 
3,055,368

    Debt and preferred equity investments, net
1,783,336

(1) 
1,580,306

 
1,954,556

 
2,228,912

 
2,272,241

 
 
 
 
 
 
 
 
 
 
Assets held for sale, net

 
391,664

 
403,488

 

 

Cash and cash equivalents
554,195

 
166,070

 
121,751

 
148,978

 
144,323

Restricted cash
66,827

 
75,360

 
94,793

 
92,169

 
151,388

Investment in marketable securities
25,353

 
29,887

 
30,208

 
29,978

 
29,406

Tenant and other receivables, net of allowance of $11,876 at 3/31/2020
88,587

 
43,968

 
44,950

 
38,270

 
47,829

Related party receivables
26,092

 
21,121

 
20,030

 
23,686

 
29,458

Deferred rents receivable, net of allowance of $11,711 at 3/31/2020
310,138

 
283,011

 
306,431

 
341,659

 
337,099

Deferred costs, net
232,274

 
205,283

 
182,621

 
220,572

 
211,615

Other assets
353,644

 
332,801

 
271,467

 
235,355

 
324,629

 
 
 
 
 
 
 
 
 
 
 Total Assets
$
13,220,607

 
$
12,766,320

 
$
13,294,984

 
$
13,629,941

 
$
13,385,774

 
 
 
 
 
 
 
 
 
 
(1) Excludes debt and preferred equity investments totaling $34.8 million with a weighted average current yield of 6.53% that are included in other balance sheet line items.
 
 
 
 
 
 
 
 
 
 

Supplemental Information
10
First Quarter 2020

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COMPARATIVE BALANCE SHEETS

Unaudited
(Dollars in Thousands)
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As of
 
3/31/2020
 
12/31/2019
 
9/30/2019
 
6/30/2019
 
3/31/2019
Liabilities
 
 
 
 
 
 
 
 
 
Mortgages and other loans payable
$
2,010,217

 
$
2,211,883

 
$
2,454,684

 
$
2,366,907

 
$
2,046,906

Unsecured term loans
1,500,000

 
1,500,000

 
1,500,000

 
1,500,000

 
1,500,000

Unsecured notes
1,252,602

 
1,502,837

 
1,503,072

 
1,503,305

 
1,503,534

Revolving credit facility
1,300,000

 
240,000

 
335,000

 
670,000

 
790,000

Deferred financing costs
(39,553
)
 
(46,583
)
 
(56,988
)
 
(57,423
)
 
(50,376
)
Total debt, net of deferred financing costs
6,023,266

 
5,408,137

 
5,735,768

 
5,982,789

 
5,790,064

Accrued interest
26,377

 
22,148

 
27,568

 
25,564

 
28,930

Accounts payable and accrued expenses
158,750

 
166,905

 
143,361

 
133,473

 
111,899

Deferred revenue
116,197

 
114,052

 
126,321

 
122,941

 
102,598

Lease liability - financing leases
162,299

 
44,448

 
44,251

 
44,034

 
43,823

Lease liability - operating leases
363,990

 
381,671

 
384,661

 
387,602

 
389,857

Dividends and distributions payable
26,563

 
79,282

 
78,541

 
79,272

 
80,047

Security deposits
59,318